First contractor problems, now the banks

Some Philadelphia consumers are fighting to save their homes. A bank is threatening to take them if the consumers don't pay up on their mortgage loans.The problem is the consumers didn't take out the loans in the first place or see much of the money.

This is a double-whammy for these poor folks. They say first they were ripped off by a contractor. Action news first warned you about him back in 2006. But now these consumers say the banks are trying to take them for their money.

"Years I've lived here and this was our first home."

But Loretta Thompson may now lose it.

"I don't have any place else to go and my husband just died April the 4th."

When her husband was still alive, he and Loretta agreed to have Calvin Harris fix up their house through Harris' business, the Philadelphia Home Improvement Outreach Program.

"He said he has a lot of banks they deal with and he could get us the money from one of those banks. He said he guaranteed we'd get the money."

At the time, the Thompson's home was paid off. They owned it outright.

But in 2005 Calvin Harris took out a $31,000 mortgage loan on their behalf and had more than $23,000 paid directly to his business.

"And he performed no repair or improvements at all to the home for that money. He simply took it," said Robert Coco, Loretta's attorney.

Loretta's kitchen floor still has cracks, so do her steps outside, her basement is far from finished and neither is her bathroom.

In 2007, Calvin Harris was convicted of theft for defrauding a number of other Philadelphia homeowners like Loretta.

But the nightmare for Loretta is far from over; you see the loan Harris took out on her home was funded by Wells Fargo.

"And they want us to pay the money they gave him. Why should we pay the money? We didn't get any of it."

Loretta has paid Wells Fargo about $8,000 for the $3,000 she did get from the loan but the bank is now threatening to foreclose on her home for the remaining money.

So Loretta is taking Wells Fargo to court suing the bank to forgive the rest of the loan.

"Wells Fargo why are you asking for our client to return moneys that she never got? You didn't fulfill the loan contract. You, in fact, never did deliver these funds to her."

Loretta's attorney has handled the cases of more than 2-dozen consumers left with loans taken out by Calvin Harris. "I've resolved all litigation with the other banks now completely. The lingering victims of Calvin Harris' scheme right now are solely Wells Fargo borrowers."

Wells Fargo says: The customer didn't inform us for many years that there was an issue with the contractor she hired. Wells Fargo doesn't make home improvement loans in Pennsylvania. Had we known that this customer had been taken advantage of by a contractor, we would have done everything possible to work with her to help protect and support her interests. This is normal course of action for any of our customers.

But Loretta says she didn't know she'd been ripped off until a lot of time had passed. To that, Wells Fargo says it has no comment.

Meantime, here's how to avoid a situation like this altogether. Do not let a contractor pressure you into signing documents. Have a professional or at least a friend or neighbor first look them over and research the contractor. Also, realize a business is not legitimate just because it has a flyer, an ad in the paper, or is able to secure a loan for you.